Banks, resource firms weigh on U.K. stocks

LONDON (MarketWatch) — Banks and resource firms led U.K. stocks lower on Monday, erasing earlier gains, after comments from the Eurogroup spread fears that more countries could be subject to “bail-in” resolutions like Cyprus.

The broader sentiment in London was initially buoyed after Cyprus and its international lenders reached a deal to save the struggling nation from bankruptcy, but stocks were sent wobbling in afternoon action. Jeroen Dijsselbloem, the chair of the Eurogroup of euro-zone finance ministers, said according to Reuters that the rescue program for Cyprus reached early Monday morning served as a template for addressing future banking problems in the euro zone.

The agreement cleared the way for 10 billion euros ($13 billion) in crucial financing, but required a restructuring of two of the country’s largest banks, including hair cuts on deposits above €100,000, the cutoff for uninsured savings.

Vodafone shares rise after a report says company may sell its shares in a joint venture with Verizon Communications.

On a more upbeat note, shares of Vodafone Group PLC
VOD, -1.74%VOD, -1.55%
gained 2%, as the Sunday Times reported that the U.K. mobile operator considers selling its shares in a venture with Verizon Communications Inc.
VZ, -0.71%
potentially leading to a $135 billion windfall for Vodafone and an exit from the U.S. market.

Aberdeen Asset Management
ADN, -2.21%ADN, -2.21%
rose 0.7%, after the investment firm said assets under management rose 10% from Dec. 31 to Feb. 28, although the business environment looks challenging for some time.

Shares of SABMiller PLC
SAB, -1.82%
gained 0.6%. The brewer said it is targeting further beer volume growth in its Latin American market over the next three to five years.

Centrica PLC
CNA, -1.56%
put on 1.3%, as the utility firm said it has signed a deal to buy natural gas from a U.S. plant, marking the first deal clearly intended to bring gas from North America to the U.K.

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